Slide 1: StarHub 2Q & 1H-2018 Results
StarHub 2Q & 1H-2018 Results 7 August 2018
Slide 2: Forward-looking Statements
Forward-looking Statements The following presentation may contain forward-looking statements by StarHub Ltd (“StarHub”) relating to financial trends for future periods. Some of the statements in this presentation which are not historical facts are statements of future expectations with respect to th
Slide 3: Presenters
Presenters Peter K. Dennis CHIA CEO CFO 3
Slide 4: Agenda
Agenda 2Q & 1H2018 Highlights Financial Highlights Business Highlights 2018 Outlook 4
Slide 5: Overview (1H-2018 vs 1H-2017)
Overview (1H-2018 vs 1H-2017) ➢ Service revenue decreased 0.6% ➢ 20% revenue growth in Enterprise Fixed ➢ Service EBITDA decreased 9.8% ➢ Subscriber growth in residential Broadband ➢ Service EBITDA margin at 30.9% ➢ Low churn rate maintained across ➢ NPAT decreased 18.5% all businesses 5
Slide 6: Key Financial Highlights
Key Financial Highlights S$M 2Q-2018 2Q-2017 Change 1H-2018 1H-2017 Change Total Revenue 597 567 5% 1,160 1,159 0% Service Revenue 467 464 1% 915 921 -1% EBITDA 155 173 -10% 309 337 -8% Service EBITDA# 141 162 -13% 283 314 -10% Service EBITDA Margin 30.2% 35.0% -4.8%pts 30.9% 34.1% -3.2%pts Taxation
Slide 7: Revenue Contribution
Revenue Contribution Quarter Ending 30 June First Half Ending 30 June 2018 2017 Incr / Incr / 2018 2017 Incr / Incr / (Decr) (Decr) (Decr) (Decr) Total Revenue S$m S$m S$m % S$m S$m S$m % Mobile services 213.5 228.6 (15.1) (6.6) 416.5 449.4 (32.8) (7.3) Pay TV services 84.7 89.0 (4.2) (4.8) 165.4 17
Slide 8: Revenue Mix
Revenue Mix Quarter Ending 30 June First Half Ending 30 June 2018 2017 2018 2017 Revenue Mix % mix % mix % mix % mix Mobile services 35.7 40.3 35.9 38.8 Pay TV services 14.2 15.7 14.3 15.4 Broadband services 7.7 8.1 8.0 8.0 Enterprise Fixed services 20.5 17.7 20.7 17.2 Total Service Revenue 78.2 81.
Slide 9: Financial Highlights
2Q & 1H2018 Highlights Financial Highlights Business Highlights 2018 Outlook 9
Slide 10: EBITDA
EBITDA (S$M) 337 309 173 163 143 154 155 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 10 * Comparatives have been restated to take into account the retrospective adjustments relating to SFRS(I) 15
Slide 11: Service EBITDA & Service EBITDA Margin
Service EBITDA & Service EBITDA Margin (S$M) 35.0% 34.1% 30.2% 30.9% 314 283 162 150 142 141 122 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 Service EBITDA Margin as % of Service Revenue *Service EBITDA = EBITDA less (Sales of Equipment – Cost of Equipment) 11 * Comparatives have been restated
Slide 12: Cost Of Sales
Cost Of Sales (S$M) 44% 44% 42% 40% 511 486 54 57 329 238 16 216 264 247 227 225 28 138 26 26 28 120 118 109 111 214 219 176 92 103 116 86 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 Cost of Equipment Cost of Services Traffic Expenses Cost of Sales / Revenue * Numbers may not add up due to roun
Slide 13: Other Operating Expenses
Other Operating Expenses (S$M) 42% 42% 42% 41% 482 470 47 44 287 255 292 293 27 249 235 25 233 22 21 25 189 155 156 146 137 135 142 68 75 71 70 71 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 Depreciation Other G&A Marketing & Promotion Operating Expense / Revenue * Numbers may not add up due to
Slide 14: Net Profit After Tax
Net Profit After Tax (S$M) 156 127 80 66 64 63 52 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 * Numbers may not add up due to rounding. 14 * Comparatives have been restated to take into account the retrospective adjustments relating to SFRS(I) 15
Slide 15: Capex (cash payments)
Capex (cash payments) (S$M) 20.2% 12.8% 10.2% 8.5% 148 115 119 95 68 52 51 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 Capex / Revenue * Numbers may not add up due to rounding. 15 * Comparatives have been restated to take into account the retrospective adjustments relating to SFRS(I) 15
Slide 16: Free Cash Flow
Free Cash Flow (S$M) 120 133 107 97 16 10 2Q2017 3Q2017 1Q2018 2Q2018 1H2017 1H2018 (32) 4Q2017 * Numbers may not add up due to rounding. 16
Slide 17: Business Highlights - Mobile
2Q & 1H2018 Highlights Financial Highlights Business Highlights - Mobile 2018 Outlook 17
Slide 18: Mobile (2Q-2018 vs 2Q-2017)
Mobile (2Q-2018 vs 2Q-2017) ➢ Post-paid customer base decreased 9k ➢ Post-paid ARPU decreased S$4 18
Slide 19: Mobile Customer Base
Mobile Customer Base (‘000) 2,307 2,283 2,290 2,256 2,258 905 895 938 918 882 39% 1,385 1,362 1,368 1,365 1,376 61% 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 Post-paid Pre-paid * Numbers may not add up due to rounding. 19
Slide 20: Post-paid Average Monthly Churn Rate
Post-paid Average Monthly Churn Rate (%) 1.6 0.6 1.1 1.1 1.0 1.0 1.0 1.0 1.0 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 Including one-time termination of 23k inactive legacy data-only lines * Change in computation basis from end-subscriber base to average end-subscriber base 20
Slide 21: Mobile Revenue
Mobile Revenue (S$M) 449.4 416.5 228.6 223.1 225.2 203.0 213.5 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 * Comparatives have been restated to take into account the retrospective adjustments relating to SFRS(I) 15 21
Slide 22: Mobile ARPU
Mobile ARPU Pre-paid (S$ per month) 15 14 14 15 13 13 13 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 Post-paid (S$ per month) 49 48 46 45 48 43 44 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 22 * Comparatives have been restated to take into account the retrospective adjustments relating to
Slide 23: Business Highlights – Pay TV
2Q & 1H2018 Highlights Financial Highlights Business Highlights – Pay TV 2018 Outlook 23
Slide 24: Pay TV (2Q-2018 vs 2Q-2017)
Pay TV (2Q-2018 vs 2Q-2017) ❖ Revenue decreased 5% ❖ ARPU increased S$2 to S$53 ❖ Customer base decreased 39k 24
Slide 25: Pay TV Base & Churn
Pay TV Base & Churn Customers (‘000) 477 467 458 449 438 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 Average Monthly Churn Rate (%) 1.1 1.0 0.9 0.9 0.9 0.9 0.9 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 25 * Change in computation basis from end-subscriber base to average end-subscriber base
Slide 26: Pay TV Revenue & ARPU
Pay TV Revenue & ARPU Revenue (S$M) 178.6 165.4 89.0 86.8 88.1 80.7 84.7 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 ARPU (S$ per month) 51 51 51 51 53 51 52 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 26 * Comparatives have been restated to take into account the retrospective adjustments
Slide 27: Business Highlights - Broadband
2Q & 1H2018 Highlights Financial Highlights Business Highlights - Broadband 2018 Outlook 27
Slide 28: Broadband (2Q-2018 vs 2Q-2017)
Broadband (2Q-2018 vs 2Q-2017) ❖ Revenue stable ❖ ARPU stable at S$32 ❖ Customer base increased by 4k 28
Slide 29: Broadband Base & Churn
Broadband Base & Churn (‘000) Customers 467 466 467 469 471 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 Average Monthly Churn Rate (%) 1.1 1.0 1.0 1.0 0.9 0.9 0.9 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 29 * Change in computation basis from end-subscriber base to average end-subscriber base
Slide 30: Broadband Revenue & ARPU
Broadband Revenue & ARPU Revenue (S$M) 93.2 93.3 46.0 46.4 47.2 47.2 46.1 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 ARPU (S$ per month) 33 32 32 32 32 32 32 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 30 * Change in computation basis from end-subscriber base to average end-subscriber bas
Slide 31: Business Highlights – Enterprise Fixed
2Q & 1H2018 Highlights Financial Highlights Business Highlights – Enterprise Fixed 2018 Outlook 31
Slide 32: Enterprise Fixed (2Q-2018 vs 2Q-2017)
Enterprise Fixed (2Q-2018 vs 2Q-2017) ➢ Data & Internet revenue stable ➢ Managed services increased 175% ➢ Voice revenue decreased 26% 32
Slide 33: Enterprise Fixed Revenue
Enterprise Fixed Revenue (S$M) 240.0 199.7 130.5 117.5 122.5 110.3 100.1 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 33 * Comparatives have been restated to take into account the retrospective adjustments relating to SFRS(I) 15
Slide 34: Data & Internet / Managed Services
Data & Internet / Managed Services Data & Internet (S$M) 146.1 147.1 74.5 74.1 75.3 72.9 74.2 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 Managed Services (S$M) 76.9 43.3 36.8 40.2 31.0 23.4 14.6 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 • Numbers may not add up due to rounding. • The re
Slide 35: Voice Services
Voice Services (S$M) Voice 22.5 16.0 12.8 11.9 11.0 7.9 8.1 2Q2017 3Q2017 4Q2017 1Q2018 2Q2018 1H2017 1H2018 * Comparatives for Voice services have been restated to take into account the retrospective adjustments relating to SFRS(I) 15 affecting Digital Voice 35 which is part of the HomeHub bundle
Slide 36: 2018 Outlook
2Q & 1H2018 Highlights Financial Highlights Business Highlights 2018 Outlook 36
Slide 37: FY2018 Outlook
FY2018 Outlook ➢ Revenue: Maintain service revenue to be 1% to 3% lower YoY ➢ Service EBITDA*: Maintain service EBITDA margin to be between 27 - 29% after adoption of SFRS(I) 15 ➢ CAPEX: Maintain cash capex to be about 11% of total revenue (excludes spectrum and building payments) ➢ Dividend: Declar
Slide 38: Investor Relations Contact
Investor Relations Contact Investor Relations Contact For IR-related queries, please email or call: Jeannie ONG Eric LOH Chief Strategic Partnership & IR Officer AVP, IR DID: +65 6825 5168 DID: +65 6825 5171 jeannieo@starhub.com / ir@starhub.com ericloh@starhub.com / ir@starhub.com 38